5 months ago

HWRK Magazine: Issue 03 - Spring 2018

HWRK Magazine

SAVING Spending once

SAVING Spending once spending wisely Three factors to consider before blowing your next school budget O ver the last five years there has been mounting pressure to reduce public spending and there’s every indication this will continue in this parliament. Schools in particular have been hit hard and things are only going to get worse with this government’s new funding formulae. Expect to see budgets fall again on top of the existing cuts. So, I thought it would be prudent in this issue to highlight what steps schools can take to try and ensure budgets go a little further. Having worked in public sector procurement for over 25 years, I’ve been responsible for awarding and managing a wide range of commercial contracts, all of which were aimed at delivering good value for money. Furthermore, when spending public funds, we must also be sure the contract terms and conditions are appropriately robust to ensure we receive the goods and services we purchased, and to protect us when things go wrong. I’ve heard many horror stores, with schools in particular, who have made some large value purchases only to be stung by the supplier. Here are three key factors to consider when you embark upon making a specific purchase: 1. WHERE TO START Firstly, it’s always good practise to examine your current spending commitments and rank them in order of value. This information should be fairly easy to obtain from various sources. Once you have this information you can then consider which areas of spend you need to attack first. From memory, outside the cost of paying for the rent or mortgage on your buildings the largest costs usually fall into salaries, temporary labour and utilities, often with a very long list of low value purchases. Typically referred to as tail spend. 2. KEY FACTORS Before we can make decisions on the next steps you also need to consider existing contractual commitments. For example, should you be tied to an existing telecoms agreement for say five years, then there’s little you can do to get out of that contract. Likewise, you must also consider when is the best time to go out to the market to make a purchase - if you know prices rise every January for a certain product or service you should be mindful of this and make your purchases during the latter months of the previous year. Other factors to consider are the internal procurement policies of your establishment. A well organised school will have a set of policies to follow before making a specific purchase. These policies will outline when and how to obtain formal quotations and when to conduct formal tendering exercises. Where spend exceeds circa £105,000, then there is the EU Procurement Regulations to consider, which sets out how you should approach the market in a predefined way. 3. WHERE TO BUY Where to buy can be as equally challenging as considering Key Factors, and as such many organisations prefer to use the professional services of an established procurement organisation, who in essence do all of the legwork for you. Two worth considering are: Crown Commercial Service (CCS) is a well-know, well-established central procurement agency that’s part of the Cabinet office. With over 600 staff that procures a range of contracts and framework agreements across a wide range of products and services including; utilities, professional service, ICT & telecoms, printers and multi-functional devices, fleet and travel. CCS has over 90 framework agreements in place, all of which offer full compliance and excellent value for money. Crescent Purchasing Consortium (CPC) are very similar to CCS, albeit their main focus is the education sector, offering a range of procurements covering: estates & facilities management, office supplies & equipment right though to ICT and telecoms. CPC currently have in excess of 50 frameworks in place. Both CCS and CPC promote their offering to be fully compliant to various regulations while offering great value for money, which in-turn will generate real savings for your school. Have you got a question for HWRK’s Capital section editor? Then email: 60 // HWRK MAGAZINE // Spring 2018 hwrkmagazine @hwrk_magazine

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